If you get laid off, there’s a system that’s supposed to help you get by: Unemployment benefits. Whenever California stares down a pandemic or a possible recession, the partial wage-replacement program is one of the most important economic safeguards for workers.
But the benefits have become more difficult for workers to access, due to the program’s design and decisions made by California’s embattled Employment Development Department. That’s according to an in-depth report released this morning from the Legislative Analyst’s Office, a non-partisan agency that provides advice to the Legislature.
The report found that the benefits program’s orientation toward businesses — which fund the benefits and have an incentive to keep costs down — led the department to emphasize holding down costs. Pressure from the federal government to avoid errors led the department to try, however successfully, to minimize fraud.
The result, according to the report: The department pursued lowering costs and hindering fraud over making it easy for workers to access benefits.
“Looked at individually, one of these policies might seem totally reasonable, either to limit fraud or or minimize business costs,” said Chas Alamo, the report’s author and principal fiscal and policy analyst with the Legislative Analyst’s office. “But when you look at them, and kind of step back and look at the suite of policies that have been made over several decades, it becomes clear that there’s a sort of imbalance in the system,” said Alamo.
Nearly 18 million California employees are covered by the SDI program through a payroll tax. The program often offers to pay 60% of a person’s wages for up to 52 weeks. A bill to significantly increase the payment rate is advancing in the Legislature.
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